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Judgment
PER RAMIT KOCHAR, AM:
This appeal in ITA No. 2458/Del/2026 for Assessment Year: 2016-17 has arisen form the learned CIT(A)’s appellate order dated 28.01.2026 u/s 250 of the Income-tax Act, 1961 (hereinafter called “the Act”) in DIN & Order No: ITBA/NFAC/S/250/2025-26/1085219390(1), which in turn has arisen from the re-assessment order dated 23.03.2022 passed by the AO u/s 147 r.w.s 144B of the 1961 Act (DIN No. ITBA/AST/S/147/2021-22/1041382994(1)).
Brief facts of the case are that the assessee filed its return of income for assessment year: 2016-17 declaring total income of Rs.3,06,310/- which was processed by CPC, Bangalore. The case of the assessee was reopened by the Revenue for framing reassessment by invoking the provisions of Section 147/148 of the 1961 Act on the basis of information received from Director of Income (Intelligence & Criminal Investigation), New Delhi that the assessee has purchased property in cash on 09.03.2016 for Rs.11,80,000/-. The reasons were recorded by the AO which were duly reproduced by the AO in Page 2 of the re-assessment order. The notice u/s 148 dated 28.03.2021 was issued by the AO, which was claimed by the AO to have been duly served on the assessee. Statutory notices u/s 142(1) were issued by the AO to the assessee from time to time, but many of the notices remained un-complied with by the assessee, However, On 25th January, 2022, the assessee submitted part reply , wherein he submitted copy of the bank statement of ICICI Bank and copy of Form No.16 only. Despite further opportunities being granted to the assessee by the AO , the assessee did not provide further replies/documents/evidences to support his contentions to the queries raised by the AO. The AO observed that the assessee was asked to provide evidences/details regarding purchase of property in cash to the tune of Rs.11,80,000/- but the assessee only provided bank statement of ICICI Bank and Form no. 16, The AO observed that the assessee has earned salary income of Rs. 4,96,108/- which is not commensurate with the investment of Rs. 11,80,000/- made in cash by the assessee for purchase of property. The assessee having failed to provide sources of investment /documentary evidences for purchase of property in cash, the AO treated the entire amount of Rs. 11,80,000/- as unexplained investment u/s 69 of the 1961 Act .
Aggrieved, the assessee filed first appeal with Ld. CIT(A) , and challenged the additions as were made by the AO. The Ld. CIT(A) observed that the assessee has submitted that in impugned assessment year, the assessee has purchased immovable property of Rs.11,80,000/- in cash , and the assessee has tried to explain the sources of such investment made via online payment as well some payment in cash as well by taking cash loans , but no documentary evidences were submitted by the asssessee to substantiate its contentions. The ld. CIT(A) observed that the assessee made general claim of agricultural income, gifts from relatives and cash withdrawal , but no supporting evidences such as land ownership records, proof of agricultural income ,conformations from donors, gift deeds nor direct nexus between bank withdrawals with property purchase have been submitted. The Ld. CIT(A) dismissed the appeal of the assessee and upheld assessment order passed by the AO, by holding that there is no infirmity in the assessment order passed by the AO in treating the cash investment of Rs. 11,80,000/- for purchase of property as unexplained investment u/s 69 of the 1961 Act.
Still aggrieved, the assessee has filed second appeal before the Tribunal. Ld. Counsel at the outset submitted that the assessee has not purchased any property in financial year 2015-16. It was submitted that no payment for purchase of property was made in cash by the assessee on 09.03.2016 as is averred by the authorities below in their orders. It was submitted that the assessee did purchase property on 03.09.2016 for Rs. 11,80,000/-, and all the payments related thereto were made vide online bank payments and part payments were made in cash, but these payments fall in the financial year 2016-17 (assessment year 2017-18) and not in the financial year 2015-16 as is alleged by the department. Thus, it is stated that the reassessment framed is bad in law and liable to be quashed on this short ground itself. the assessee has now filed before ITAT as an additional evidence, the details of property purchased which is by way of sale deed (placed in Paper Book at page No.61 to 71) registered on 03.09.2016 for total sale consideration of Rs. 11,80,000/- which is stated to be a residential flat, bearing property No.1/2740, Plot No.60, land area measuring 62.75 Sq. Yds(52.46 square meters), out of Khasra No. 603, consisting of Upper Ground Floor, (without roof rights), situated at the area of village Sikdarpur, in the Abadi of Gali No.11, Ram Nagar, Loni Road, Illaqa Shahdara, Delhi-110032, which reflects that the property was registered in the name of Parvesh Kumar for Rs.11,80,000/- being purchased from Kulbir Singh and Ram Singh, and registered on 3rd Sep. 2016 vide Registration No.4115 in Book No.1 Vol. No.2,263 on page136 to 145 with Sub-Registrar, SR IVA- Shahdara, New Delhi.. The sale deed is placed on record in file . The ld. Counsel for the assessee submitted that the assessee has also filed details of payments made to the sellers by the assessee in the form of a chart, and no payments were made during the year under consideration. This chart is also placed for the first time before the ITAT , the same is placed in Paper book(PB/Page 59-60). Thus, at the outset, Ld. Counsel for the assessee submitted that the orders of authorities below are perverse as the sale transaction as well payments were made in the Financial Year 2016-17, and not in the impugned assessment year 2016-17 relevant to Financial Year 2015-16. It was submitted that on this ground itself, the appeal needs to be allowed, as there are perversity in the order of the lower authorities below. The assessee has also filed bank statements of Indusind Bank(A/c No. 100001606261), ICICI Bank(A/c No. 182401502679) , Axis Bank(A/c No. 916010035789579) and SBI-in the name of Mr.Bajrang Lal Sharma(Father)( A/c No. 51018779463), which are placed in paper book/page no. 30-49).
On the other hand, the Ld. Sr. DR relied upon orders of authorities below. The ld. Sr. DR submitted that the assessee has raised this issue that the said transaction of purchase of property and payment thereof pertains to Financial Year 2016-17 i.e. for Assessment Year 2017-18 and not for the financial year 2015-16 i.e. for the Assessment Year 2016-17 , for the first time before the Tribunal. This plea was never raised before the authorities below. It was submitted by ld. Sr. DR that the assessee has also placed additional evidences before the Tribunal for the first time, which were never produced before the authorties below. These contentions as well evidences/documents which are now filed by the assessee for the first time before the Tribunal needs verification by the authorities below, and prayers were made to set aside and restore the matter back to the file of the authorities below.
I have considered the rival contentions and perused the materials available on record. The Revenue got the information that on 09.03.2016 , the assessee has made payment in cash amounting to Rs. 11,80,000/- for purchase of property. The case of the assessee was reopened for framing reassessment u/s 147/148 of the 1961 Act. The statutory notices were issued by the AO. The facts in brief as well contentions of both the rival parties are culled out in the preceding para’s of this order, and are not repeated. I have observed that the assessee has for the first time before the Tribunal raised the plea that the purchase of the property took place in financial year 2016-17 relevant to the assessment year 2017-18, and not to the financial year 2015-16 relevant to assessment year 2016-17. The Revenue has the information that the assessee made purchase of property in cash on 09.03.2016 totaling to Rs. 11,80,000/-, but now the assessee is taking plea for the first time before the Tribunal that there was no cash payment made for purchase of property on 09.03.2016, and rather the purchase of the property totaling to Rs. 11,80,000/- was made on 03.09.2016. This plea is taken for the first time before the Tribunal. I have observed that before the AO , the assessee only supplied copy of ICICI Bank statement and Form No. 16, while before ld. CIT(A), the assessee stated that payment for purchase of property was made partly through online payment through bank, and partly through cash by raising cash loans, agricultural income in cash of the father Mr. Bajrang Lal Sharma and cash withdrawal from banks. The assessee has filed additional evidences for the first time before the Tribunal. The details of such evidences are enumerated in preceding para’s of this order. These additional evidences filed for the first time before the Tribunal and contentions of the assessee that the property was not purchased during the year under consideration, requires verification and examination by authorities below. Thus, keeping in view entire facts and circumstances of the case and in the interest of justice and fairness to both the parties, I am setting aside the orders of the authorities below and remitting the matter back to the file of the AO for denovo assessment on merits in accordance with law after affording proper and adequate opportunities to the assessee. On its part , the assessee is directed to co-operate in denovo assessment proceedings, and submit all the required information/documents/ evidences as may be required by the AO for framing denovo assessment. The AO is directed to admit all the evidences submitted by the assessee in its support. I clarify that I have not commented on the merits of the issue. The appeal of the assessee is allowed for statistical purposes. I order accordingly.
In the result, the appeal filed by the assessee is allowed for statistical purposes.